Operating loss smaller than market estimates

Daishin Securities headquarters [Daishin Securities]
Daishin Securities headquarters [Daishin Securities]

Daishin Securities swung to a consolidated operating loss of 2.2 billion won ($1.62 million) in the third quarter, reversing from a profit a year earlier, as a slowdown in stock market trading weighed on earnings. The actual loss, however, came in well below market expectations.

According to preliminary earnings disclosed Monday, consolidated sales reached 2 trillion won in the third quarter, up 142.7 percent from a year earlier. Sales fell 21.4 percent from the 2.55 trillion won posted in the second quarter.

Profitability deteriorated sharply. The third-quarter operating loss of 2.2 billion won marked a reversal from an operating profit of 73.6 billion won in the same period last year. Compared with the second quarter's operating profit of 359.9 billion won, operating profit fell by 362.1 billion won in a single quarter.

The net loss for the quarter came to 13.7 billion won, swinging from a net profit of 40.1 billion won a year earlier. The pretax net loss reached 3.3 billion won, compared with a pretax profit of 65.1 billion won in the year-ago period. The net loss attributable to owners of the parent company was 19 billion won.

The company cited a decline in stock market trading volume as the primary driver of the earnings deterioration, saying reduced brokerage commission revenue weighed on results as market activity slowed.

The loss was nonetheless narrower than analysts had anticipated. BNK Investment Securities had estimated Daishin Securities' third-quarter operating loss at around 37 billion won, but the actual figure was limited to 2.2 billion won.

On a standalone basis, results were weaker than the consolidated figures. Third-quarter sales came to 1.78 trillion won, with an operating loss of 58.9 billion won and a net loss of 42.9 billion won.


kacew@heraldcorp.com